Work out a plan to deal with coal supply: PMO to CoalMin

New Delhi: The PMO has asked the Coal Ministry to work out a plan of action to deal with the present situation — arising out of cancellation of allocation of 214 coal blocks by the Supreme Court — in consultation with infrastructure ministries so that end-use plants are not stranded in the absence of fuel.

“It is essential to ensure the end-use plants in the infrastructure sector are not stranded for want of coal supply. Hence, the Ministry must have worked out a plan of action to deal with the present situation in consultation with the infrastructure ministries,” the Prime Minister Office said in a recent letter to Coal Secretary S K Srivatava.

It further said that “the same may be shared with this office’’.

Nripendra Misra, Principal Secretary to Prime Minister Narendra Modi, had written earlier to the Coal Ministry regarding the contingency plan to deal with the implications of the Supreme Court’s judgment on coal block allocation.

In a major blow to the corporate sector, the Supreme Court had last month quashed the allocation of 214 out of 218 coal blocks allotted to various companies since 1993 terming it as “fatally flawed” and allowed the Centre to take over the operation of 42 such blocks which are functional.

It said the beneficiaries of the illegal process “must suffer” the consequences and refused to show sympathy to private companies which submitted that Rs. 2.87 lakh crore have been invested in 157 coal blocks and Rs. 4 lakh crore in end-use plants.

It, however, saved from the “guillotine” four allocations — one each to SAIL and NTPC and two blocks to Sasan Power Ltd owned by Anil Ambani’s Reliance Power — and also gave a six months breathing time to rest of them to wind up their operations by March 31, 2015.

The apex court directed the the allottees of coal blocks to pay within three months an additional levy of Rs 295 per metric ton of coal extracted to compensate financial loss caused to the exchequer by the illegal and arbitrary allotments.